ADEA Washington Update

Secretary DeVos Seeks to End Gainful Employment Regulations

(Education, Financial Aid, Gainful Employment, Higher Education) Permanent link   All Posts

Secretary of Education Betsy DeVos proposes to rescind the gainful employment (GE) regulations, which establish the eligibility requirements for a program that prepares students for gainful employment in a recognized occupation, including the debt-to-earnings rates measures, alternate earnings appeals, reporting and disclosure requirements, and certifications.

The Obama-era regulation allowed the federal government to terminate all Title IV federal funding to institutions of higher education where graduates end up with higher student loan debt than earnings. It also provided a pathway for those same graduates to use the federal government’s income-driven repayment plan. To be eligible for federal funding under the Higher Education Act Title IV student assistance programs, an educational program must lead to a degree at a nonprofit or public institution or it must prepare students for “gainful employment in a recognized occupation.” As of January 2017, nearly 800 programs could not meet the minimum threshold of providing career opportunities for students—98% of those were in for-profit schools.

DeVos has recommended a replacement for GE, a scorecard that will publish information on how well graduates of programs at all schools—public, non-profit and for-profit—fare. The scorecard would feature employment data, average loan burdens and earnings information for programs. Comments on the proposed rule changes are being accepted through Sept. 13 on regulations.gov.

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